HomeEconomic IssuesHealth Insurance Giant Faces Lawsuit For Allegedly Tricking People Into Canceling Policies!

Health Insurance Giant Faces Lawsuit For Allegedly Tricking People Into Canceling Policies!

Since Obamacare was voted into law, Republicans and Tea Party groups have joined forces in a massive effort to stop it.  They’ve voted 47 times in the House to repeal it.  They ran an entire Presidential campaign in 2012 on “bad Obamacare” and conservative media outlets have run story after story on its “evils.”

They’ve invented a long list of lies about Obamacare that have been repeated so often, they have turned into “truths” at most right-wing gatherings.  These tall tales have even made their way into mainstream America as evidenced by the anti-Obamacare skit at the Academy of Country Music Awards.

The latest “the sky is falling” issue of course has been, “but Obama said, if we like our coverage, we can keep it.  Why is my insurance company cancelling my plan and raising my premiums?  Obama LIED,” etc.

While there has been a lot of discussion about who is actually screwing people over under the guise of  Obamacare, some people in California have had enough and they’re taking a stand in Court to fix the blame on the healthcare giant, Anthem Blue Cross.  An article published Wednesday in International Business Times quoted from the suit itself:

“Since March 23, 2010, “Blue Cross successfully enticed tens of thousands of its individual policyholders to switch out of their grandfathered health plans and forever lose their protected grandfathered status,” the lawsuits state. “Blue Cross concealed information about the consequences of switching plans and intentionally misled its policyholders to encourage the replacement of grandfathered policies.”

Under the Affordable Healthcare Act, policies issued prior to March 23, 2010 were “grandfathered in” or, were not subject to the new coverage regulations under the ACA.  Insurance companies were not allowed to drop those policies.  But in reality, it appears that insurance companies all across the country have been “fudging” on that part of the law to entice customers into paying more for “updated” coverage.  If the customer signs up for the new coverage, thereby opting out of their “grandfathered coverage”, then they forever lose the protections afforded to them under the ACA.

In a nutshell, there has been a tidal wave of letters sent by insurance companies to their policy-holders telling them that their old “grandfathered” coverage did not meet the requirements in the Affordable Care Act, and they had until January 1st to accept the companies “updated” plan (almost always at a much higher premium) or stand the risk of losing their health coverage completely.  The letters fail to inform the customers that they have other options under the ACA, and about the options on Healthcare.gov.

While MOST of these people would qualify for tax subsidies that would greatly reduce their premiums, deductible, or out-of-pocket expenses.  A high percentage of those customers don’t do the research, don’t shop the exchanges, and actually sign up for the new coverage at insane rates because they hoodwinked into believing that “Obamacare is the devil” and they are frightened about losing their healthcare.

In the new suit filed in California, Think Progress reported:

“The plaintiffs, Paul Simon, 39, and Catherine Corker, 63, of California say that they are among the customers that Anthem Blue Cross pressured to drop their grandfathered policies in 2011 without giving them all the facts about new Obamacare requirements that could raise the price of their plans in an effort to cut its own costs. Simon and Corker would have preferred to remain on the grandfathered plans permitted by the law, and are now asking the courts to block Anthem from canceling any more policies unless the company allows consumers to switch back into their grandfathered plans.”

The tragedy of this story of course, is that people are being duped by companies hiding behind the right-wing obstruction machine’s wall of hate and lies about Obamacare.  People who are either poorly informed or TEA party tainted, are being slammed in the pocketbook by greedy and manipulative health insurance companies.

The whole underlying reason for Health Care Reform in the beginning, was to rein in these companies for the benefit of the consumers.  That certainly makes more sense every day.   Hats off the Mr. Simon and Ms. Corker for standing up and saying no.


Americans Against The Tea Party is a group committed to exposing the Tea Party’s lies, violence, racism, ignorance, intolerance, bigotry, and corporatist fascist efforts to subvert our democratic process – and we are organizing to defeat Tea Party/GOP candidates on ballots everywhere.
  • Joe

    What’s somewhat hilarious, but not really, is that Blue Cross continually claims in advertisement how for the people they are. I’m not the least bit they lied to people, of course. Maybe someone should sue them for false advertising as well.

  • https://www.facebook.com/jonah.manke Jonah Manke

    This actually surprised anyone?

  • http://gravatar.com/sunny47446 sunny47446

    What you failed to mention is that if your state did not expand medicaid you are screwed. I am all for the ACA. I would use it if it would do me any good. But, my state doesn’t expand medicaid so it would not work for me.

  • http://twitter.com/KateKarwowska Kate Karwowska (@KateKarwowska)

    I’ve been with Anthem Blue Cross for many years. The only “changes” made have been by them in the form of rate increases with every birthday. Yet I’ve received a letter saying my plan is no longer available but that I can get a “new” policy for only a 136% increase in my premiums.

  • Diana Gillum

    I am a customer service rep for a blue cross company (not anthem), and we tried to keep people in their grandfathered policies. We had been instructed for a long time that we can’t let anyone change policies without being warned they would loose their grandfathered status. Not all insurance companies are evil. And yes some people are going to have to pay higher premiums with the new policies, but just as many are going to paying less, even without tax credits.

    • randall857

      To Diana’s point, there are completely different healthcare company’s that carry the BCBS name. They just have to meet certain criteria to be able to use it. If u accidentally cross associate two different company’s, it will be like blaming Burger King for something McDonald’s did. Same industry, different company. Some are very poor and others are non for profits that tend to have better practices.

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